Testing for Ar(1) Serial Correlation Want to be able to test for whether the errors are serially correlated or not e Want to test the null that p=0 in u,=pu, I + t=2., n, where u, is the model error term and e is iid o With strictly exogenous regressors, the test Is very straightforward - - simply regress the residuals on lagged residuals and use a t-test Economics 20- Prof andersonEconomics 20 - Prof. Anderson 2 Testing for AR(1) Serial Correlation Want to be able to test for whether the errors are serially correlated or not Want to test the null that r = 0 in ut = rut-1 + et , t =2,…, n, where ut is the model error term and et is iid With strictly exogenous regressors, the test is very straightforward – simply regress the residuals on lagged residuals and use a t-test